National Credit Regulator refers Shoprite Investments Ltd and Shoprite Insurance Company Limited to the National Consumer Tribunal for breach of the National Credit Act
Media Release October 2015
The National Credit Regulator (NCR) has announced that it has referred Shoprite Investments Ltd and Shoprite Insurance Company Ltd (“Shoprite”) to the National Consumer Tribunal (Tribunal). The referral follows an investigation by the NCR which revealed that:-
- Shoprite Investments Ltd and Shoprite Insurance Company have:-
- Sold retrenchment and occupational disability covers to pensioners and consumers receiving government’s old age grants; and
- Sold retrenchment cover to a consumer with a waiting period of 6 months on a six months’ loan.
“The sale of retrenchment and occupational disability covers to pensioners and consumers receiving government social grants is unreasonable and imposes an unreasonable cost to such consumers because they cannot claim benefits under these covers”, Jacqueline Boucher, Acting Manager: Investigations and Enforcement says.
“Credit providers are required by law to explain the terms and conditions of insurance policies to consumers at the point of sale. Consumers should not be sold insurance that is not suitable and appropriate for their needs”, Boucher says.
The NCR has requested the Tribunal to order that:
- Shoprite refund the affected consumers the retrenchment and occupational disability premiums;
- An audit be conducted into Shoprite;
- The reckless loans be written off; and
- Shoprite pay an administrative fine.
The NCR will continue to conduct industry-wide investigations on credit insurance practices to protect vulnerable consumers such as pensioners and the disabled.
National Credit Regulator
Tel: (011) 554 – 2722